It was perhaps an unfortunate naming convention. A convention, in fact, as unfortunate as it was unconventional. But the “Mad Max” driving mode in electric vehicle giant Tesla’s (TSLA) full self-driving mode is leaving a bad taste in a lot of mouths. Including some mouths that might well put an end to full self-driving as we know it. Investors got concerned as well, sending Tesla shares down fractionally in Friday afternoon’s trading.
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Basically, Tesla’s full self-driving system has several “modes,” or styles of driving. Modes like Sloth and Chill are much more sedate, and more prone to obeying rules. Yet there are times when the rules of the road simply cannot apply, and in some cases, actually make the road a more dangerous place when being followed. And these times are where Mad Max comes in.
Mad Max has been caught on video behaving badly in the past. It has been seen rolling through stop signs. It has violated speed limits like bad suggestions; one video showed a Tesla in Mad Max mode going 82 miles per hour past a sign that read “Speed Limit 65.” But this is likely little concern to the companies that make self-driving tools, as these tools are ultimately in the hands of the end user. As is the liability for using these tools.
Bad News from the Sales Floor
We all knew that electric vehicle sales were going to start cratering once the government stopped handing over free money—in the form of tax credits—for buying them. We have seen automakers pull back on electrification plans all over the spectrum, and Tesla is no exception. Admittedly, Tesla has also proven that it can take some of these slings and arrows, but there will still be wounds. And the United States sales numbers demonstrate as much.
New reports say that Tesla’s United States sales will likely end up down 8.9% in a year-over-year comparison. The third and fourth quarter drops are staggering in their own right; Tesla brought in a 29.8% decline in the third quarter, and the fourth quarter will likely feature a 22.4% drop as well, reports note. Tesla was eager to stem the losses with lower-cost versions of the Model 3 and the Model Y, but these new models have not delivered the kinds of sales Tesla hoped for.
Is Tesla a Buy, Hold or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on TSLA stock based on 11 Buys, 12 Holds, and nine Sells assigned in the past three months, as indicated by the graphic below. After a 14.8% rally in its share price over the past year, the average TSLA price target of $382.87 per share implies 20.03% downside risk.
